Carrefour's sales continue to be underpinned by growth in Latin America and improvements in on shelf availability in French hypermarkets.

Over the first half global sales reached €43.7bn, up 0.9% and over the second quarter sales were broadly stable at €21.7bn (-0.3%). The main positive from the statement is that over the half like for like (LFL) sales in France including petrol improved by 0.3%, marking a step back into positive territory.

France: food sales and availability improving, focus on Drive

Overall LFL sales in food in France have moved into positive territory over the half following several quarters of decline. Non-food, however, continues to be impacted across European markets by the poor economic environment and consistently poor weather.

The improving performance in France is in part driven by encouraging results in smaller stores, as LFL sales in French hypermarkets fell by 3.5%. However, food sales trends did improve, suggesting the retailer's Project Reset, designed to turnaround the French hypermarket performance, is beginning to have an impact. As part of the project, Carrefour committed to improving on shelf availability by 50% across the store. It has hit this target in food but only recorded a 40% improvement in non-food categories in 2011.

There has been a large step up in the number of Drive outlets Carrefour operates in France, an area where rivals Auchan and Casino are also investing a lot of effort. The Drive service offers click and collect facilities for grocery, with customer orders being fulfilled from supermarkets and hypermarkets or standalone sites.

The Drive concept has the potential to make a material contribution to LFL sales. Carrefour now has 125 such outlets in its French stores, with 67 openings in Q2, including 19 in hypermarkets and 48 in supermarkets.

Southern Europe continues to weigh on sales

There are some positives across the group's mature European markets, notably in Belgium where LFL sales grew by 0.8%, building on growth of 7.1% in 2011. However, excluding France, sales across the European zone fell by 3.5% reflecting the severely challenging environment in Spain (-5.3%) and Italy (-5.5%). The downward trend in Spain is slowing and non-food sales in Italian hypermarkets improved, signalling stability rather than further deterioration.

Growth story continues in Brazil with China improving

Brazil is now firmly established as the group's second market, with LFL growth of 6.2% ex. fuel confirming the ongoing success of Atacadao (the group's cash and carry business) and the strength of the hypermarket recovery. In Asia, the most important news is that non-food is recovering in China, with total growth of 2.1%, fuelled by expansion, although LFL sales are still in negative territory at -3.6%.

For our overview of Carrefour's global supply chain operations please click here.